What is an Order Management System?
An OSM – Order Management System is any tool, platform or software that tracks sales, orders and inventory as well as enables the people, partnerships and porcesses necessary for products to find their way to the customers who purchased them.
To be fair, OSM’s have not really changed in decades. Although what has changed is, are buyer expectations and the sales and retail landscape.
Today, order management systems requires multi-dimensional systems that needs to touch nearly every facet of how a company operates, which includes:
- Sale channels
- Product information
- Inventory levels and location
- Suppliers for purchasing and receiving
- Customer service; namely, returns and refunds
According to a Retail Systems Research survey of over 500 logistic based firms and suppliers and retailers worldwide, the legacy and traditional systems are indeed one of the top factors obstructing a good omnichannel execution for business, with at least 30% of companies, naming legacy and traditional systems as their top challenge and issue in 2017.
Of course, each new channel can give your business access to new customers/buyers hence increased discoverability, to keeping track of the volume and velocity of those orders will bottleneck your business if you haven’t planned the right approach for scalable progress and growth.
Of course, there will be a downstream impact of these bottlenecks that will affect both your employees and your customers.
“When you scale an eCommerce brand,” says Darren Templeton, Director & Founder of Hargreaves Motors, “having the right backbone is important that it is in place to help you grow. So endorsed and good systems that are trusted and recommended by industry, just like Shopify. TradeGecko or Xero can really help you look after the company and you can grow off these building blocks.”
Today’s modern OSM’s mange the complete supply chain as a robust interconnected ecosystem, allowing buyers and merchants to automate their everyday internal processes from order through to fulfilment and customer satisfaction.
But for everything to run smoothly, these OSM’s should give you the ability to
- Route orders from warehouses based on proximity to destination
- Update inventory levels across systems and sales channels
- Surface and forecast stock levels in order to avoid stock-outs
- Provide order details to warehouses or 3PLs for fulfilment
- Track order for both customers and customer service teams
- Integrate with back-office functions like accounts receivable, accounts payable, and ledger to generate invoices and accepts payments
- Accept orders and payments regardless of channel origin or currency
The Xero-TradeGecko integration setup was super easy and with that made our bookkeeper very happy, now that all invoices and bills between the two systems happen automatically and seamlessly.”
As some of you maybe proficient spreadsheet aficionados will know this is a lot of information to keep track of and funnel through your company under your old order management system.
So, hire additional bodies to help you manage increased sales numbers, but this won’t do anything to address manual errors, which will continue to multiply as your company grows.